About this Show

Power Lunch

News/Business. Today's news on the economy, markets, real estate, media and technology. New. (CC)

NETWORK

DURATION
01:00:00

RATING

SCANNED IN
San Francisco, CA, USA

SOURCE
Comcast Cable

TUNER
Virtual Ch. 58 (CNBC)

VIDEO CODEC
mpeg2video

AUDIO CODEC
ac3

PIXEL WIDTH
528

PIXEL HEIGHT
480

TOPIC FREQUENCY

Us 15, U.s. 11, Clinton 9, Tyler 9, China 9, New York 7, Washington 6, Motorola 5, Fbi 5, Obama Administration 4, Obama 4, Afghanistan 4, John 3, America 3, Asia 3, Charlotte 3, Syria 3, United States 3, Iraq 3, Google 3,
Borrow a DVD
of this show
  CNBC    Power Lunch    News/Business. Today's news on the economy,  
   markets, real estate, media and technology. New. (CC)  

    September 5, 2012
    1:00 - 2:00pm EDT  

1:00pm
cooperman, the chairman and ceo of omega advisers and guest host for the full hour starting at 12:00 p.m. eastern. pretty good year in the market, as well. talking to him about that, apple a big holdings. follow me on twitter. i'm going to throw it over to tyler right now. "halftime" is over. power lunch and the second half of the trading day starts right now. from one hopeful redskin fan to another. it's been years, guys, since -- i'm wearing my redskin cuff links today in honor of the nfl. good afternoon, ladies and gentlemen. the search is over. we have found, yes, we have, the individual investor. where has she or he been? but now that they're getting back in to the market, does it mean it's time for you to get out? it often does. also today, a big business executive backing president obama on business. who says obama's bad for
1:01pm
business? not this time. we'll talk to him in a short while and find out why. and what this stock fed-ex says about the american economy. there is the chart. it is down about 1% today. you know the numbers. slashing the earnings forecast. blaming a weak global economy. shipments down. a real well weathbellwether. >> all is right with the world. you and i are back together again. >> great to be here. >> terrific. for months now, market watchers and pundits here at cnbc asked, where is the individual investor? how could they miss when rally? jeff cox found them and their cash and apparently they're back, right, jeff? >> they're back. if you look at cash starting to come off the sidelines. the latest american association of individual investors survey showing cash at 15-month lows in portfolios. now, it's an early sign.
1:02pm
it's only one survey. but it shows that they're beginning to be confidence now from investors. maybe a little bit of movement now that the summer's over. >> are they putting it in to stocks, though, or fixed income? >> going in both places and that's the big question because the bun mun is coming off the sides and going in to bond funds and starting to see some go in to equities. this is a sentiment poll. the fund flows are not completely confirming this now but definitely some indications if you look at some of the other sentiment surveys, the investors' intelligence, 51% bullish there. so, now that summer vacation is over, there's a big party in the market all summer and more people want to come to the clam bake. >> all right. ty, you want to get in here? >> jeff, what people say they intend to do and what they ultimately -- i say every year i'm going to spend less at christmas and every year i spend more. people say they get back in the market. do they really follow through? >> what we know is here the
1:03pm
sentiment surveys looked at contrarian indicators for the market. in other words, when they're strongly bullish, that's a signal to come to the end of a party and plan an exit strategy and watch these things. they start to get over 50% or so, which is where the investors intel survey is now, 51% bulls. when they start to get maybe mid-50s you want to start to think, eh, maybe we're -- >> all right, jeff. sue, you have another guy here there? >> kenny pulcari, do you agree? >> i think it's exactly what he said. once that number better than 50% it is like the individual investor's always late to the party. they watch the market melt up over the last couple of months and feel like i'm going to miss this. it's always the point. right? september's a tough month and people really need to take a quick breath, take a step back for a minute and watch the unfolding drama. september's full of a lot of drama as we know. >> which brings us to the
1:04pm
possibility of qe3 in the u.s. and the possibility that grurp gets the house in order with the address of mr. draghi. >> listen. there's a lot of macroeconomic data. we have the whole political election with us. the democratic convention this week and headlines kind of causing the market to do actually nothing today. like we see insurance. >> very much on hold. >> the ecb tomorrow is thursday and looking forward to it and until the german high court passes on the 12th the ecb is handcuffed and kind of take the time and wait. it is a very patient month. >> tomorrow is important but the 12th is key? >> key. >> of september. >> with the german high court saying we don't support this, it throws it all in to turmoil once again. certainly i think we are going to get more out of the ecb of a program of bond buying but i don't believe it's the big bazooka he promised and a potential for the market to be disappointed.
1:05pm
i don't think it's going to crash. >> up 30 points to the plus side today. >> yeah. i think the mrkt's going to test. i think the possibility that the market pierces 1400 tomorrow. and then potentially test at 1375 level. i don't think it's going to crash an probably fair. >> all right. we need to put -- dinner. >> you saw the history on that story. >> we'll talk about that later. thanks, kenny. coming up as we continue, has america lost its way in terms of foreign policy? iraq, iran, afghanistan, syria, china. a long list of problems. and some say the list of solutions is very short. without american leadership, what would the world look like? we'll talk about that coming up. plus, hit the democratic national convention in charlotte. president clinton talks economics. he's coming up tonight. but before that, and before the break, five big wednesday movers with a big move to the upside in office depot. better than 13% and monster worldwide is up almost 8%. more "power" coming up.
1:06pm
1:07pm
1:08pm
tonight as you know the democrats rolling out big business backers to explain that the obama administration's economic plans are working. one of those backers is austin
1:09pm
liggen. welcome back. nice to have you here today. >> thanks very much. i'm glad to be here. >> we talked to a lot of business leaders on "power lunch" and cnbc and a lot of them feel uncertain and the jobless rate at levels no one want it is see, so why is it you think the administration's policies have worked for the economy? >> well, look. i think you need to step back to the very beginning of the administration and remember what our starting point was. we were not a stable economy when barack obama took office. we were still in free fall downwards. we were losing 700,000, 800,000 jobs a year and fairly quickly the auto industry went in to cardiac arrest. more than 20% rf retail sales poised on the edge of the abyss and obama's -- the obama administration actually took very rapid and decisive action. they restructured which i differentiate from a bailout.
1:10pm
a bail yut pouring money in to the same old folks. restructuring taking aboutive control. they dismissed management as incompetent which they were and they restructured general motors and chrysler and really within a fairly short period of time those companies were actually working effectively again. >> right. >> as you know, auto sales up more than 50%. in fact, we have a great report yesterday. same thing with talf. the auto securitization financing program. there was no auto securitization financing. no one could make car loans to consumers. >> i don't think anybody disputes the fact that the president inherited, you know, a catastrophe. >> okay. >> on a global scale. i'm just wondering, does the economic policies or do the economic policies that he's put in place, certainly they have stemmed the red ink and the blood that was on -- >> much more than stemmed the red ink and the blood.
1:11pm
you have as i say nearly 60% growth in the auto industry. >> but does that growth go to other industries, do you think? i mean, yes, it helped the auto industry. but -- well, the latest report on manufacturing was a big disappointment. the jobless rate is extremely high. so, i don't know that you can argue that those policies have worked in a lot of other parts of the economy. >> so, here's what -- the point i'm trying to make to you is i think what people like to forget is how bad things were and how much we have to do simply to stop the collapse, to stabilize. so this is the worst recession we have had in 80 years. last time we had a recession this bad it took more than a decade to recover from it. it's not taking that. but with the headwinds that we are getting of europe, the slowdown in china, this is not something that is easy. and i think the programs have worked and the policies have worked. the reality is none of us are happy with where we are but
1:12pm
we're much better off than any developed country in the world right now. >> i'd like to turn to a question of taxes and a proposal gnat administration has to increase taxes on the highest earners in the economy. >> sure. >> the company that you co-founded carmax is not a small company now. it once was. i'd like to put yourself in the shoes of a small business owner who is thinking about the possibility that his or her tax rate is going to up by 3% at the margins under a second obama administration. if he's re-elected. would that if you were in their shoes affect your ability, your intention to add jobs because as you know -- >> no. >> -- mr. romney said this kills job creation. >> look. taxes were higher than they are today when we founded carmax. taxes were higher under george w. bush. they were higher under ronald reagan. the answer is that's marginal. secondly, the vast majority of small business wouldn't be
1:13pm
affected by it. >> it wouldn't affect your intention or ability -- >> absolutely not. >> to hire ten for people. >> i'm an angel investor now. i work with start-up companies. i'm on the board of six or seven. i'm the chairman of gazelle.com. we never have these discussions. this doesn't affect our planning. what we're interested in is does our business model make sense? how's the consumer doing? the focus needs to be on consumers and not millionaires. they don't spend the money you give them. it's consumers in the pyramid spend every dollar you give them and that's where we need to focus. >> what about the deficit issues of the country? and do you think that the president has put in place policies that adequately address the deficit issue and now facing the fiscal cliff coming up, as well? >> look. the fiscal cliff is something, it's a politically created issue. the answer is, once again,
1:14pm
president bush inherited a 2% structural surplus. he turned over a 2% structural deficit in the last year of full employment and then when the economy collapsed the same level of spending ballooned to roughly 10%. so, this is once again something that president obama was handed. it's not going to be easy to solve but it was really president bush who painted us in to a corner. i think the president has some good plans. truth be told i think after the election we're going to need to sit down and have more simpson-bowles type discussions but sensible people of both parties can get this done. everybody agrees but it's a political hot topic in the middle of an election. >> thank you so much for joining us, sir. a pleasure to talk with you. >> thank you for having me. let's check the action in the bond market. it's a key week on many fronts. the ecb meeting and much more. rick santelli live from the floor in chicago. hi, ricky. >> hi, sue. indeed. you know, markets are definitely
1:15pm
not going to wait forever but they're certainly waiting now with the uncertainty of what mr. draghi will discuss in the morning. we look at a 24-hour chart of 10-year yields, mid-150s and 160 and darn close and now one point above unchanged at 158. open it up to a month and clearly see the low end of the yield scale over a month and contrast wit the european's safe harbor trade and up about 9 basis points today and a 1-month chart has a different pattern. the difference between the two hovering around a dozen basis points about the narrowest in about five weeks. we need to pay attention. euro currency. we are still above or at 126. the high of the day is 126.25. two months, the euro seems to be the beneficiary of the microphone close to a two-month high. tyler, it's back to you.
1:16pm
>> mr. santelli, thank you very much. now kayla for a market flash. hi, kayla. >> hi, tyler. the tale of two stocks and the tech market is concerned. first, disney touching an all-time high. it's never reached before. that's on the back of announcement of nokia disney producing character-based apps for the new smartphones and now the tablet space and sony said they would not be drawn in to pricing wars. not the right thing to say in an area where sony is struggling. sony touching a 25-year low. tyler, hasn't seen the lows since vcrs and walkmans were the main products. >> i remember those. thank you very much. let's move on to motorola mobility. got the first product launch out today. since being bought by google. holding a big event in new york city. comes just hours after microsoft and nokia revealed their new windows-based phones. jon fortt with the latest of the product launch across the river
1:17pm
in new york. jon? >> reporter: right behind me, tyler, the event kicks off in just under an hour and the main question is going to be, what's the differentiating feature of any phones that motorola might unveil here. what will google and motorola choose to focus on? a thing that's come up, of course, lte. the networks are built out. everybody trying to put forthlte and screen resolution and clarity is a key issue. now, i just got done talking to a google product manager about a host of issues. one was feature phones. motto orola has feature phones. a question i had is what happens to that business? do they spell it, spin it out? it sounds like google is planning to organically let it wind down as people switch over to smartphones. goog wl the nexus 7 back in
1:18pm
june. what will motorola do with tablets? putting out their own. i don't know to expect to hear anything about that today but perhaps another motorola tab let. i'll have the latest of motorola as the announcement happens. back the you. >> thank you so much, jon. so many choices in the investment space in mobile commuting. in mobilecom putting what is your number one pick? >> well, it's not going to be nokia or google. surprisingly, not even apple for other reasons. i go with amazon. they're getting in to a market with 50% penetration already and coming in at a third of the price with all of the access to their online e-commerce and m-commerce prices. >> we like amazon in mobilecom putting best. you mentioned apple. why not apple? it's the darling of the sect.
1:19pm
>> sure. there's two concerns on apple. one is will r there any iphone 5s disappointments and people not happy with the innovations? most important thing is apple starting to get to a 20% level in the nasdaq 100. the etfs, mutual funds benched to that index and others starting to get to the point to look to rebalance as they did in 2010 if apple goes higher there could be substantial selloff. >> from etfs and mutual funds who are holders? thank you very much. sue, back to you. >> thank you. well, the democratic convention has turned the pot light on charlotte, north carolina, this week. here's the economic drill down on the nation's 19th largest city. in just the past decade, nearly 7,000 firms have invested more than $12 billion in to the queen city thanks to its stronghold of finance, transportation and distribution. with a population of 772,000, metro charlotte currently has an
1:20pm
unemployment rate of 9.8% and an average household income of a little more than $54,000 a year. it's also the nation's second largest banking center outside of new york with $2.3 trillion in assets and home to 9 fortune 500 companies. some of the city's top employers include wells fargo, bank of america merrill lynch and walmart. duke energy is there, as well as is food lion, at&t, lowe's and u.s. airways. and speaking of charlotte, tonight president clinton takes center stage. comeback of sorts. john harwood is there live. he's a persuasive and charismatic speaker. >> reporter: especially on the economy, sue, which is why your economic data in the intro is so appropriate. last night we heard from the san antonio mayor and michele obama in motivational terms to the key democratic constituency groups,
1:21pm
african-americans, hispanics, women. but tonight president clinton gets the heavy lifting talking about the economy weighing down president obama with 8% unemployment, with a deficit annually over $1 trillion and with a traditional debt that's now hit $16 trillion. so what president clinton's going to do is what he did in a commercial he cut for president obama very recently in which he praised president obama's economic plans as resembling his own when he presided over the boom in the '90s. a balanced approach to deficit reduction, tax increases and spending cuts and key investments. i just talked to a senior strategist for the obama campaign who said we all know that bill clinton has his own distinctive speech making process which has to do with rewrites right up to the last minute but this aide had seen the speech. said it's not going to disappoint and precisely what democrats hope president clinton will do to tee up president
1:22pm
obama's speech on thursday night which, as you know, has been moved inside to this hall instead of outside at the bank of america football stadium because of the threat of thunderstorms. tyler? >> thank you very much, john. when we return, when's happened to american foreign policy? there are hot spots all over the world and not as many people worldwide are listening to the u.s. so how does uncle sam recapture the lost mojo and should we? plus, we're analyzing the analysts. on deck, williams sonoma, time warner and cliffs natural resources. before a break, take a look at some more wednesday winners. "power lunch" will be back in two. [ male announcer ] what if you had thermal night-vision goggles,
1:23pm
like in a special ops mission? you'd spot movement, gather intelligence with minimal collateral damage. but rather than neutralizing enemies in their sleep, you'd be targeting stocks to trade. well, that's what trade architect's heat maps do. they make you a trading assassin. trade architect. td ameritrade's empowering web-based trading platform. trade commission-free for 60 days, and we'll throw in up to $600 when you open an account. we're sitting on a bunch of shale gas. there's natural gas under my town. it's a game changer. ♪
1:24pm
it means cleaner, cheaper american-made energy. but we've got to be careful how we get it. design the wells to be safe. thousands of jobs. use the most advanced technology to protect our water. billions in the economy. at chevron, if we can't do it right, we won't do it at all. we've got to think long term. we've got to think long term. ♪ ♪ i can do anything ♪ i can do anything today ♪ i can go anywhere ♪ i can go anywhere today ♪ la la la la la la la [ male announcer ] dow solutions help millions of people by helping to make gluten free bread that doesn't taste gluten free. together, the elements of science and the human element can solve anything. solutionism. the new optimism.
1:25pm
dow up a little with scott freeze president of street one financial. let's jump right in here. deutsch bank. williams sonoma to $48 saying consistently strong comps of near term merchandising
1:26pm
initiatives. nice run-up. you like this call or not? >> love the call. >> love the call. >> two big reasons. >> like the store. love the call. >> exactly. pottery barn. growing and in an environment where buying is flat. >> let's move on. ubs upgrading time warner to buy from neutral noting in addition to the significant returns, quote, we view it as a defensive play given that it has less exposure to advertising versus the piers. why didn't they do this when i worked there? up or down? >> i'm fairly neutral on time warner. i think that the upgrade is really hoping that the flickster relaunch adds to them and looking to add the ad revenues. >> breaking my heart. credit suisse downgrading cliffs. unavoidable exposure to the commodity price and iron ore
1:27pm
fallen over two months. downgrade. you agree? >> disagree. cliffs has nothing to do with the price. down 35% recently. they're the best positioned company in the space. as soon as you get some production, and some good numbers out of china and the economy rebounds, with this talked about qe, that's set to pop. >> thank you. we'll be back with you later. hammers claim they stole apple idty. is your prooif at risk? and the metals close. we'll hit the floor of the nymex on the other side of this break.
1:28pm
in communities across the country. whether it's supporting a delaware nonprofit that's providing training and employment opportunities, investing in the revitalization of a neighborhood in the bronx, or providing the financing to help a beloved san diego bakery expand,
1:29pm
what's important to communities across the country is important to us. and we're proud to work with all of those who are creating a stronger future for everyone.
1:30pm
gold market closing right now. jackie deangelis is tracking the action at the nymex. a downside buy is there but i notice that platinum and palladium and copper were moving higher, jackie. >> absolutely. good afternoon, sue. start with gold prices. closing a hair lower today. we are under $1,700. the price is backing off of the six-month high we saw yesterday and holding their own as we wait to see what happens with the ecb tomorrow. now, having said that, the
1:31pm
short-term range of traders is $ $1,675 and keep in mind a nice run-up with gold. 5.5% in the last month alone and holdings of gold based etfs risen to a record high. some of the other metals, silver lower and copper and palladium and platinum higher and the reason for copper hitting a one-month high because the euro has risen on talk about some bond buying of the ecb and traders watching that meeting so closely tomorrow. if we see improvement in europe, we'll see traders coming in and putting the riskier asets back on the table. sue, back over to you. >> thank you very much, jackie. all right. let's talk about the trading action here. bob pisani joins us. holding. >> that's exactly it. >> waiting for the ecb again. >> even on the advance-decline line, the patterns on the major sectors, not a lot of clear buying patterns emerging. a day normally materials and
1:32pm
industrials move in similar directions, you can see they're not -- when you get telecom advancing as much as material stocks, the trading patterns on the random side and fed-ex, they lowered the guidance on important things. global demand is weaker. not just domestic and global demand higher and higher jet fuel prices so that's a problem in the express division and 60% of the revenue. that's the big national, international money maker and probably going ahead with retruck which you aring that division now and probably closing some offices. that's how you retruck which you are there. >> united continental is cutting once again the capacity outlook and the cfo says beginning to see modest slowness in the economic outlook and cut capa outce this year. >> the airlines trading up on that news and the market thinks that's kind of good news. as far as i can see, i'm on airlines a lot this summer. they're full everywhere i go. they must feel somethisind of coming up in the next month
1:33pm
or so to even slow down their traffic a little bit more. >> an ability to spend. yeah. thank you. good to see you. all right. let's go to kayla with a market flash. hi. >> hi, sue. we're watching shares of aurico gold. this company seeing its shares hit nearly 20% to the downside today. previously said production was under pressure at one of its iron ore mining projects but now saying that the weakness could continue not only in to 2012 but 2013. having to hire mining contractors to get some of those jobs done because of an outflow of some of the labor force in part at that mine. and also, saying that cap ex going to rise with the changes. sue, not going to be an easy road for a couple of years for aurico. >> no. down almost 20% today. thank you. to the nasdaq. maybe there's bright spots over there. seema mody is a bright spot and following the big movers.
1:34pm
>> why, thank you. the smartphone war is a big topic of discussion here in the land of tech and not just about apple and nokia but the broader ecosystem. for example, microsoft, a lot of traders focusing in on the stock. the phone running on microsoft's new mobile operating system. the stock flat today and up 17% year to date and focus on qualcomm. j and p securities writing the best smartphone play this holiday season and you should expect to see qualcomm in many of the new products unveiled over two weeks. also, want to put your focus on marvel. that's semiconductor stocks outperforming. upgrading the stock to neutral. got to take a look at facebook right here up better than 4.5%. after the c eo said he will not sell his shares. tyler? >> not selling. seema, thank you very much. let's move on to other tech newses. hackers apparently targeting apple. eamon javers live in washington
1:35pm
with the details. >> reporter: we have a he said/she said between the hacker group and the fbi of all federal agencies. let's take a look at what we know so far. the hacker group is called antisec claiming to have posted 1 million apple identifying data pieces of information. they also say that they've got 12 million of these i.d.s in total and only posting a few as a sample. they say they got the information from the laptop of a fbi special agent by hacking in to that laptop and includes unique device identifiers, user names and in some cases links it to personal information such as e-mail addresses. now, here's what the fbi says about this. they say at this time there is no evidence indicating that a fbi laptop was compromised or that the fbi either sought or obtained this data. now, i talked to the fbi about
1:36pm
that this morning and saying there's no evidence of this agent had this information on his laptop. wasn't a personal situation with it on an off the the record basis. they say he simply didn't have the information that the hacker group said he had. now, here's where this story starts to get really weird. as part of their posting, the hacker group said they wouldn't give any interviews until a particular writer for the website gawker.com posed on the internet in a tutu balancing a shoe on his head. and as you can see adrian chen the writer for gawker did just that today. there's the picture. it's up there on the home page right now. we don't have any information yet on whether they give him the interview but he wore the t you utu. >> if they're people of their word they'll give her an interview. >> reporter: that's what journalism is all about these days, right? >> thank you very much. there's new reason to ask
1:37pm
that evergreen real estate question. buy it or rent it. diana olick is live in washington. hi, diana. >> reporter: hey, tyler. rents are definitely still rising. make no mistake but we may be seeing the first signs of overheating. nationally in august, rents rose 4.7% year over year. and that's strong but not as strong as the 5.8% jump in may and it's the slowest growth since march. now, all real estate is local. rents up more than 10% in houston and seattle and while they're still high in denver, san francisco, miami, oakland and boston, the increases are smaller than they were in may. so what's causing the slowdown? multifamily construction starts have been way up over a few years and coming online now. investors have also bought thousands of distressed properties and now coming on as rentals. single family. a new report of rent.com found nearly half of current renters surveyed said they're still
1:38pm
saving for a down payment. nearly a quarter are waiting for their credit to improve. witness today's mortgage application survey down for the fifth straight week. applications to buy a home down 5% in august month to month and down 8% of a year ago. we spoke to investors about this saying they're not really that concerned and believe a still recovering housing market can co-exist with a growing rental market. we have plenty more on the blog. sue? >> diana, thank you. coming up, is american foreign policy power gone forever? iran, afghanistan, iraq, syria, china, the list of problems is long. is the word of the united states respected anymore on the global basis? a new survey shows u.s. global competitiveness has fallen again. what do you blame? vote on that at finance.yahoo.com and we'll talk about that coming up. at usaa, we believe honor is not
1:39pm
1:40pm
exclusive to the military, and commitment is not limited to one's military oath. the same set of values that drive our nation's military are the ones we used to build usaa bank. with our award winning apps that allow you to transfer funds, pay bills or manage your finances anywhere, anytime. so that wherever your duty takes you, usaa bank goes with you. visit us online to learn what makes our bank so different. i bought the car because of its efficiency. i bought the car because i could eliminate gas from my budget. i don't spend money on gasoline. it's been 4,000 miles since my last trip to the gas station. it's pretty great. i get a bunch of kids waving at me... giving me the thumbs up. it's always a gratifying experience. it makes me feel good about my car. i absolutely love my chevy volt. ♪
1:41pm
welcome back. we're taking a look at shares of transocean falling just about 2% today. investors threeing on the back of a memo of the jus disdepartment filed with a louisiana court saying that transocean in willful misconduct in the activities with bp in the deepwater horizon spill which it was always involved in. the company's lost roughly half the market value since then and meantime the company supposed to eye up to a billion dollars of rig sales by the end of the year to upgrade the fleet. the ceo saying that couldn't happen until likely late 2013. back to you. >> thank you. in today's yahoo! finance poll a new survey shows that u.s. global competitiveness fallen again. what do you blame the most? let's take a look. 15% say the education system. 50% say washington and politics.
1:42pm
10% say american parents. 4% say pop culture. hmm. sue? >> very interesting, ty. thank you. >> i would have said the education system. >> i agree with you. we were flipping through "the new york times" today in the newsroom as we always do and seemed today as if there's a foreign policy problem for the united states on almost every single day. indian fish enmen captured by sri lanka. iraq sending militias to support syria president. iran flying supplies to assad and not stopping the flights and secretary of state hillary clinton's not so successful trip to beijing. when's become of american foreign policy? have we lost our clout and power? can we get it back? jeff schmitt is joining us.
1:43pm
jeff, that's the basic question, it does seem as though as the world becomes more interconnected and perhaps more economically powerful, the u.s. seems to be losing its influence when it comes to crises. is that a correct read or not? >> no, i think it is a correct read. there's no question we have lost some of the ability to shape global affairs compared to ten years ago. the important question is why and i think the rise of china and alternative power centers is certainly one explanation. but, you know, the failure of our economy to perform over the past ten years is probably even a greater indicator. we consistently underestimate the direct linkage between our economy and the ability to shape affairs abroad. you know, foreign capitals weighed the performance of the economy very heavily in how carefully and closely they listened to washington. >> in the past, also, we have
1:44pm
provided foreign aid to a number of those countries and now increasingly they do not need it as much. correct? >> well, this is true. i mean, the ability of these countries now to turn to china who may not condition its aid as strictly as the united states does, who may not have the same criteria that these countries need to follow certain human rights rules and regulations or use the aid in a proper manner has certainly given countries an alternative to go to and in turn has weakened their dependence on the u.s. >> what does the united states have to do do you think to regain that clout? and then on the other side, should it try to do that? a lot of people say we should not be policing the world. >> absolutely we should regain our international clout. and i think we can do that two ways. you know, the rise of china has eroded the influence and also created an opportunity. a new window. you know, there's a lot of
1:45pm
countries particularly in asia and africa who are getting very concerned and getting very wary of the rise of china and done almost a complete u-turn and welcoming american influence back in to the region and we need to take advantage of those opportunities. but the most important thing we need to do is get the economic house back in order and with economic strength will come expanded influence abroad again. >> is there -- give the obama administration a grade in terms of foreign policy. i mean, if you look at the cover of "travel & leisure" this month it's hillary clinton the secretary of state is on the cover and she is the most traveled secretary of state in history. and she's certainly had a number of key problems to deal with. the arab spring is just one of them, certainly. give the administration a grade on how they have handled foreign policy and some of the issues that have been cropping up. >> well, secretary of state
1:46pm
hillary clinton has gotten high marks from both democrats and republicans. the obama administration overall has had some very important successes, most notably the killing of osama bin laden. he's had setbacks elsewhere. broadly i think he has done better than some expected on the foreign policy front. but as i mentioned before, our foreign policy is directly affected by the economic performance at home. and our inability to get our debt and deficit under control is aversely affecting the availability to wield influence abroad so i'd say it's a much lower score. >> mr. smith, two questions. first, how afghanistan and our apparent sort of stalemate maybe at best in that country has figured in to this loss of influence or mojo on the global stage. and secondly, iraq, which i think would get some positive marks from some individuals and probably negative marks from
1:47pm
some quarters of the world in terms of what went on there. i suspect that iraq on balance is better off than it was ten years ago. but, maybe not everybody would agree with that. >> well, i'll tell you. it's very difficult to say we have gotten a net gain or a net benefit out of the iraq war and perhaps even the afghanistan war. which is why you've seen the administration make such an emphasis on the pivot to asia. and, you know, i support that move because in truth east asia is going to be the sort of center of geopolitical activity in the years to come and i think in some ways washington is trying to put these chapters in the middle east behind us and focus on what we can do in asia an moving forward. >> it is that pivot to east asia that really concerns the chinese, though. it's the point of contention there, right? >> absolutely it is. but it's also a demonstration of what we were talking about earlier. you know, if you go back seven or eight years, some of our a y allies in east asia and the countries on the fence growi ii
1:48pm
weary of american power in the region and china many think is overplayed the hand and now you see many of these countries, you know, calling up washington wanting to know when's the next time to do military exercises? how can we buy more u.s. arms? >> interesting. >> it ian been a real u-turn in the region in the last three years. >> jeff, thank you so much. i know we'll be talking to you again soon on this very topic and applies to jonathan. we had technical issues and weren't able to connect with him but we'll have you both back soon. ty? >> all right, sue. coming up. the nfl season kicking off tonight. big question for me, clinton speech, new york giants. i don't know. the new ugg campaign is out with tom brady. does the endorsement make you want to buy the furry boots or leave you saying ugg? why president obama is teaming up with harold and kumar. that is straight ahead.
1:49pm
at optionsxpress we're all about options trading.
1:50pm
we create easy to use, powerful trading tools for all. look at these streaming charts! they're totally customizable and they let you visualize what might happen next. that's genius! strategies, chains, positions. we put 'em all on one screen! could we make placing a trade any easier? mmmm...could we? open an account today and get a free 13-month e ibd™ subscription when you call 1-888-280-0149 now. optionsxpress by charles schwab.
1:51pm
welcome back. we're watching shares of chesapeake which are rising sharply on the day ahead of an
1:52pm
appearance tomorrow of the ceo stripped of the chairman title and appearing in front of a barclay conference, the first public appearance since an inquiry in to the personal finances and the company's cash flow in early may. sue? >> thank you. some important numbers out on video games today. julia boorstin's on the story for us joining us live from l.a. hi, julia. >> reporter: hi, sue. bad news for traditional gamemakers and potentially good for zynga and facebook. number of people in the u.s. playing video games declined 5% from last year. that's 12 million fewer gamers according to a new report. gamers have shifting away from traditional console games to mobile and digital games. together now represent 38% of gamers and mobile games are now -- mobile gamers now the biggest piece of the pie, bigger than core or pc gamers. the problem is that the shift means that gamers spending less
1:53pm
overall. the average spent on digital games is 16 bucks compared to $48 on physical gains. but this could be good news for zynga and perhaps facebook if they can figure out how to host that mobile game play and take a cut and then, tyler, we'll have to see how the traditional gamemakers continue to adapt and try to get a piece of this pie, as well. >> thank you very much. "power rundown" time with the dot-com dynamic duo. cindy and john. the obama campaign tapping actors boast known for using drug users. harold & kumar go to the dnc. tick a quick work. >> i'm trusting you on this and i'll see you then. >> dude, who was that? sounded intense. >> the president. >> sweet.
1:54pm
>> any way to court the youth vote or one step too far, john? >> i think it's a pretty good way to court the youth vote. he's in touch and a funny commercial. >> what do you say? >> absolutely. court the youth vote. you also get the middle age vote and reminds us of a time we didn't -- >> yeah. i want to bring in the president here. john, would you bring in the president here? bring him up. there. let's ask the president. what were you thinking when you went after harold and kumar? >> he said mitt romney's mormon and can't drink coffee and thought the weed vote is up for grabs. >> thank you for being with us today and looking forward to your speech tomorrow night. a new study finds america once again behind the curve as a global competitor dropping behind switzerland.
1:55pm
roger federer. singapore. and the netherlands. the dutch as a world economic competitor. you know it's bad when six european nations beat us. what do you think to this? >> i think that the study is complete nonsense. this is a survey of what i call the davos man. probably never going to get invited to the world economic forum because of this but they didn't see the crash coming. how the world economy will go, consistently wrong and if they want to rank the u.s. lower it is like s&p downgrading the u.s. i don't care what the pinheads think about us. >> how do you really feel, john? what are you saying? rather do business in the lol land or u.s.? >> i'm going to go holland. >> seriously? you are going to hear about this. >> oh. >> you're going to hear about this. the next one. new york's fierce rivalry with boston, it's well-known.
1:56pm
yankees-rocks. giants of patriots. imagine the reaction to a new bill board of tom brady wearing a pair of uggs. yes, he is good looking. popular in new york? not so much. was this one of the worst marketing decisions ever made? john, what do you say? >> no. they're really aiming at women. women looking going i don't know who that is but good looking guy. >> good looking guy. what do you say? >> my issue is tom brady on a bill board in new york, tyler. if you put eely manning on a bill board in boston they would be burning cars or should i say cars in harvard yard? >> you don't own a pair, do you? >> i don't. as a female vote, if they want me to buy them with tom brady, bend it like beck ham and put him in boxers and uggs and then maybe think about it. >> panty hose once if you recall. all right. sue? >> on that note, in the next hour, speaking of football, a
1:57pm
real life stock draft. you don't want to miss it. we're back in two.
1:58pm
1:59pm
well, we have the ecb meeting and the jobs report and that has the dow